The Hecks have operated Pacific Mobile Home Manor on the same tract of land since 1983. Within Pacific Manor is a mobile home pad addressed as 303 South Second Street, which is positioned approximately 14 feet from the pad to its south, and the same distance from the pad to its north. When renters moved out with their mobile home in the late 2000s, the Hecks attempted to install a new mobile home of the same size on the vacant pad around two years later. The city of Pacific, however, informed the Hecks that the new mobile home could not be placed upon the pat unless they obtained a variance from the city code provision – adopted in 1996 – that requires 20-foot spacing between mobile homes or other structures. Mr. Heck testified before the Board of Zoning Appeals (BZA) that he was under the impression that he already had a variance for the pad because the pad and mobile home on the pad were permitted when he bought Pacific Manor in 1983. The ZBA voted to deny the variance, and the Hecks appealed.

The Hecks argued that Pacific Manor existed in its present configuration, including the spacing of mobile home pads, prior to the adoption of the 20-foot spacing requirement in 1996; in other words, that their legal nonconforming use applies to the mobile home park as a whole and not on a “per pad” basis. Mr. Heck testified “I mean I can’t really move all the trailers out and get rid of them and totally reorganize that all. So I’m just trying to maintain the property and keep it as nice as I can.”

The city, on the other hand, argued that even if the present configuration and spacing of pads in Pacific Manor was a lawful nonconforming use, it has since been extinguished by “structural alteration” – moving the old mobile home off the pad. Furthermore, the city argued that the nonconforming use was abandoned because the pad sat vacant without a mobile home for two years.

The Court of Appeals concluded that the BZA did not analyze the case as a nonconforming use case; rather, the BZA was simply concerned with whether the Hecks’ application met the standard for a variance. “A nonconforming use differs from a variance.” The Court of Appeals remanded the case to the ZBA to hear evidence on the issue of whether the Hecks are entitled to continue a lawful nonconforming use, noting that “if in fact the Hecks have continued their lawful nonconforming use of Pacific Manor, the spacing requirements [of the city code] do not apply and no variance is needed.”

In the City of Roseville, Michigan International Outdoor, Inc. (IO) applied to erect a billboard 70 feet high, 672 square feet total, 365 feet from property that was zoned residential. Due to regulations on billboards within city limits, the Building Department denied the application. IO appealed the decision to the Zoning Board of Appeals (ZBA) who also denied the application. IO then appealed to the circuit court, challenging the constitutionality of the ordinances. After the circuit court also found in favor of the City, IO appealed to the State of Michigan Court of Appeals.

IO argued that the ordinances of the City of Roseville constitute an unconstitutional prior restraint because the city has not applied the stated objective standards for billboards found in the ordinance in a consistent manner. It maintained that the ZBA has ignored or waived those objective standards on an ad hoc basis, and relies solely on subjective criteria such as “in harmony with the general purpose of the sign ordinance,” “injurious to the neighborhood,” and “detrimental to the public welfare” when denying billboard applications. These criteria, IO argued, have been found in previous court cases to be insufficiently precise and therefore unconstitutional prior restraint. The city countered that the circuit court was correct when it found the regulations on their face to be narrow, objective, and definite, and that IO’s proposed billboard did not meet the standards of those regulations.

After noting that IO’s challenge was to the application of the ordinances by the ZBA, the court noted the key holdings in previous prior restraint cases:

A licensing scheme that gives public officials the power to deny use of a forum in advance of actual expression is a prior restraint on First Amendment liberties.

Any system of prior restraints on expression bears a heavy presumption against its constitutional validity.

A law subjecting the exercise of First Amendment freedoms to the prior restraint of a license must contain narrow, objective, and definite standards to guide the licensing authority.

Moreover, a licensing law that places “unbridled discretion in the hands of a government official or agency constitutes a prior restraint and may result in censorship.

Because IO could not meet the strict application of the narrow, objective, and definite terms of the city’s Sign Ordinance, it was required to present evidence that a variance from the ordinance was necessary; i.e., that a practical difficulty or unnecessary hardship existed. The record reflected that the ZBA applied this test in determining that a variance could not be granted. the application of the test meant that the ZBA was not operating with unbridled discretion when it denied the variance.

Additionally, IO argued that commercial speech is protected under the First Amendment. As such, any restriction or regulation must be advance a substantial government interest, and the ordinance must be narrowly tailored to meet that interest. IO does not believe that it is narrowly tailored because the ZBA has the discretion to grant one request for a billboard otherwise restricted by the ordinance, but deny others. The court rejected this argument, noting that the stated purpose of the ordinance – “to protect the health, safety and welfare of the citizens of the City of Roseville, including but not limited to defining and regulating signs in order to promote aesthetics, to avoid danger from sign collapse and to regulate sign materials, avoid traffic hazards from sign locations and size, avoid visual blight and provide for the reasonable and orderly use of signs” – is a substantial governmental interest. The court simply stated that IO provided “no relevant legal authority or factual support for its claim.

The circuit court’s decision in favor of the City of Roseville was affirmed.

Farmer’s Cooperative (FC) owns a number of grain bins in Earlham, and temporary grain storage bins outside the city limits. These facilities predate Earlham’s zoning ordinance, and do not conform to existing zoning regulations. FC purchased land adjacent to its existing operation where it intends to build additional grain bins, and filed an application to have the land rezoned from residential and commercial to “M-Industrial.” The rezoning request was approved. Later, FC requested a building permit for the additional grain bins, but was denied by the zoning administrator because the proposed bins would not comply with height or setback requirements. FC filed a variance request with the Earlham Zoning Board of Adjustment (ZBA) to allow construction of bins with no setbacks, and heights that exceeded the height limitations. The ZBA approved the variance, but Arnburg [presumably a nearby resident] filed an action in district court. The district court remanded the case to allow the ZBA to hold an additional hearing and make written findings of fact.

At the rehearing FC presented evidence on the need for a variance, including economic data on the profitability of conforming structures and evidence of an agreement with the city showing that the city intended to ease the concerns of neighboring residents. Local residents, on the other hand, presented evidence of existing problems with grain dust covering nearby homes and sidewalks, and discussed problems on nearby streets due to heavy truck traffic. They also alleged that the proposed bins would create a safety hazard due to both their height and proximity to the lot lines. The ZBA issued an oral and written opinion granting the variance, finding that the residents’ concerns had been addressed by an agreement between the city and FC, that the bins would not alter the character of the city, and that FC’s economic analysis proved the land could not be used profitably without the variance. The case went back to district court, which affirmed the ZBA’s decision on summary judgment.

At district court Arnburg contended the ZBA acted illegally by allowing for the expansion of a nonconforming use. The city disagreed that the existing bins are a nonconforming use, and the variance in fact expanded a nonconforming use even if the existing bins were judged to be such. The Court of Appeals found that, contrary to the determination of the district court, a genuine issue of fact exists in the case that precludes summary judgment. The Earlham Code concerning variances provides in part that: “no nonconforming use of neighboring lands, structures or buildings in the same district, and no permitted use of lands, structures or buildings in other districts shall be considered grounds for the issuance of a variance.” In reviewing the ZBA’s findings of fact, the Court of Appeals found conflicting evidence as to whether that language was satisfied. On the one hand, the ZBA found that the variance would not create a new business, but rather only expand an existing business. The Court considered this to be evidence that the ZBA was not considering the height or setbacks of the building but rather the business itself. On the other hand the ZBA also stated as justification for the variance the fact that FC “also has bins that exceed the local ordinance standards presently.” With both these statements in the ZBA’s findings, the Court found that a genuine issue of material fact existed and remanded the case for further proceedings.

The City of Norfolk, Nebraska zoning code includes the following provision with regard to nonconforming uses:

In the event that a nonconforming use is discontinued, or its normal operation stopped, for a period of one year, the use of the same shall thereafter conform to the uses permitted in the district in which it is located.

The Rodehorst Brothers partnerships owns a fourplex in Norfolk an area zoned R-2 for one and two family use. The fourplex is a legal, nonconforming use. In 2010 and 2011 Rodehorst applied for building permits to replace a roof, fix some electrical issues, and remodel the apartments in the building. The first two were granted by the building inspector but the third (apartment remodels) was denied because the inspector concluded that Rodehorst had forfeited its right to continue its nonconforming use of a fourplex because several of the apartments in the building had been unoccupied for more than one year.

Rodehorst appealed the denial of the permit to the City of Norfolk Board of Adjustment (Board), and also requested that they grant a use variance to allow the building to continue operating as a fourplex. Rodehorst argued that simply failing to rent out the apartments did not cause a forfeiture of the right to operate as a fourplex, and that it had been trying to “fix up” the building for years. Rodehorst also argued that it would suffer an undue hardship without the use variance. The City argued that the right to operate the building as a fourplex was forfeited because the apartments were unoccupied for more than one year. The City further argued that the Board did not have authority to grant a use variance because the zoning code defines “variance” as “relief from or variation of the provisions of [the zoning code], other than use regulations, as applied to a specific piece of property, as distinct from rezoning.” The Board agreed with the City on both arguments, and Rodehorst appealed the decision to the district court.

At the district court Rodehorst employed the same arguments but went on to say that the Board’s ruling was an unconstitutional taking. The district court, however, affirmed the Board’s ruling in all respects.

Rodehorst appealed the decision of the District Court to the Nebraska State Supreme Court using the same three arguments as when it appealed to the District Court.

Right to continue nonconforming use. Nebraska Revised Statutes provides that, with regard to nonconforming uses for cities of the first class, “if a nonconforming use is in fact discontinued for a period of twelve months, such right to the nonconforming use shall be forfeited and any future use of the building and premises shall conform to the regulation.” The Supreme Court first noted that the choice of the word “discontinued,” as opposed to “abandoned,” is important. Abandonment requires not only a cessation of the nonconforming use, but also an intent by the user to abandon the nonconforming use. Where a legislature or other zoning authority has used the word “discontinued”…instead of “abandoned” their purpose is ‘to do away with the need to proved intent to abandon.'” This squares with the plain, ordinary meaning of the term “discontinue,” and is consistent with the notion that nonconforming uses are disfavored because they reduce the effectiveness of the zoning ordinance, depress property values, and contribute to the growth of urban blight.

Rodehorst argued that the nature and characteristics of the building control; in other words, that the building is and always was divided into four separate living units. The Court disagreed. After reviewing cases from several other jurisdictions, the Court concluded that

The degree of occupancy is the critical factor in determining whether a multifamily dwelling nonconforming use remains in effect, while the existing characteristics of the building (such as separate units and features) generally go to whether the user intended to abandon the nonconforming use. As noted earlier, intent to abandon is not relevant because [Nebraska] zoning laws speak in terms of discontinuance….Thus, the degree of occupancy of the building is the central inquiry.

Noting that “this is not a situation where the discontinuance was involuntary” but rather that no effort had been made to rent the apartments for a number of years, the Court ruled that “a discontinuance period will run where the landlord did not really try to rent the premises.” Thus, the Court affirmed the district court on this argument.

Authority to grant use variance. Citing the relevant provision of Nebraska Revised Statutes, which allows for the grant of a variance “when by reason of exceptional narrowness, shallowness, or shape of a specific piece of property…or exceptional topographic conditions” the Court denied Rodehorst’s argument for a use variance because the request was based on its desire to continue using its building as a fourplex, not because of any physical characteristic of its property.

Taking. While acknowledging that discontinuance provisions may work a taking in some cases, the Court denied that such a claim could be sustained in this case. Using the three-factor test from Penn Central, the Court concluded that (1) even assuming a 50 percent diminution of value, that level of loss generally does not equate to a regulatory taking; (2) Rodehorst bought the property when it was already a nonconforming use, and thus his reasonable investment-backed expectations should have been that he could continue it as a fourplex only so long as its use as such was not discontinued for a period of one year; and (3) the character of the governmental action – to gradually eliminate nonconforming uses over time – is a recognized good.

In 2010, Rebecca Rach built a house on Wilke Lake in the Town of Schleswig. When she purchased another piece of land at the back of her residence, the Town built a road on part of it to give 4 lake residents access to a main road. The remainder of the land is wetland. Rach petitioned the Manitowoc County Board of Adjustment for a variance to construct a 4’ x 50’ walkway and a 40’ x 40’ patio adjacent to a concrete porch on the east side of her house, facing the lake. The patio would intrude 49 feet into the 75-foot required shoreland setback. Rach argued that without the variance, she would suffer an unnecessary hardship because there was no other place on her lot to construct a patio. Board members conducted an on-site inspection of Rach’s property and held a hearing on her request. Rach and her husband presented a landscaping plan showing that the patio would be built with materials and plantings to aid infiltration and catch any runoff. The Town stated in a letter that its board and planning commission both approved Rach’s variance request. However, the Wisconsin Department of Natural Resources, by a letter from a shoreland zoning specialist, opposed the variance, citing the lack of unnecessary hardship and the negative effects the patio and walkway encroachment would have on the lake.

Rach’s husband testified that they could not have built their house further back because the land behind their house was for sale after they had built and that, with the remainder of the land being wetland, there is no room to build a patio. A Board member even commented, “I don’t think [the DNR shoreland zoning specialist] realized that…. He wasn’t there [at the property].” So the Board concluded that Rach faced an unnecessary hardship because the wetlands behind the house is not suitable for a patio; the landscaping of the patio would handle runoff; and the variance would not be against the public interest because the landscaping would screen the patio from the lake, beautify the shoreline, and create a buffer to prevent runoff. The Board reduced the walkway’s width from 48 to 42 inches and the patio’s length from 40 feet to 20 feet, cutting the setback intrusion to 29 feet. The variance was approved as modified. The State filed a complaint in the circuit court, which affirmed the Board’s decision. So the State appealed to the Wisconsin Court of Appeals.

The Wisconsin Court Appeals reviewed the Board’s decision by applying the substantial evidence test to determine whether the evidence before the Board was sufficient. Substantial evidence is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” In its review, the court must presume the correctness of the Board’s decision. When a variance request is before the Board, it must decide whether denying the variance would impose an unnecessary hardship on the landowner. Unnecessary hardship must be based on conditions unique to the property itself and cannot be self-created. The State argued that Rach failed to produce sufficient evidence of “unnecessary hardship” and that the hardship Rach faced was self-created because she built the house a year before applying for the variance, choosing its size and where to situate it on the lot. The State also argued that a patio is not essential and if Rach wants one she can build it, instead of a garage, at the back of the house. However, the court reasoned that even if Rach could construct the patio on the wetland, substantial evidence existed to support the Board’s decision because the State’s arguments ignored that building the patio behind the house would leave Rach without a garage—”disagreeable in Wisconsin.”

The Board must evaluate the hardship with the purpose of the zoning restriction in mind, and a variance cannot be against the public interest. The purpose of a shoreland zoning ordinance “is to protect navigable waters and the public rights therein from the degradation and deterioration which results from uncontrolled use and development of shorelands.” Since the Board considered the purpose of the ordinance and after viewing the site and taking testimony from the Town and the DNR, it modified the variance by imposing conditions designed to protect the shoreland setback zone. It found that, as modified, the construction would not be against the public interest. The Board acted within its authority, so the Wisconsin Court of Appeals concluded that the Board’s decision to grant the variance to Rach was supported by sufficient evidence.

Gordon and Kathy Michaels have operated a 340-acre dairy farm in the Town of Farmington since the 1970s and hoped to develop or sell the land to fund their retirement. In 2005, the Town adopted a new zoning code and revised its subdivision ordinance. The zoning ordinance established 5-acre minimum lot sizes. The subdivision ordinance limited the number of building permits that could be issued per year. The Michaelses sought a variance to allow them to develop their acreage into 1½-acre lots. They claimed they could not sell their farm to a developer due to a unique and unnecessary hardship as a result of the ordinances and other stray voltage issues. The circuit court ordered the Town to convene the Board of Zoning Appeals and allow the Michaelses a hearing, but the BOZA denied their variance request.

When the Michaelses appealed this decision, the circuit court remanded the case and ordered the BOZA to issue a decision that stated its reasons for denying the variance. The BOZA clarified that the Michaelses’ evidence was based solely on economics, and the stray voltage issues did not qualify as an unnecessary hardship because the Michaelses still operated their dairy farm. The circuit court concluded that the BOZA’s decision was not arbitrary, oppressive, or unreasonable and that the BOZA could reasonably deny the Michaelses’ variance request, which the Michaelses appealed to the Wisconsin Court of Appeals.

The Michaelses argue that since they spent six years trying to get the hearing, it was unfair for the circuit court to allow the BOZA a “do-over” to supplement its earlier decision. The Wisconsin Court of Appeals disagreed and held that the circuit court properly remanded the case to the BOZA for it to better express its reasonings for denying the Michaelses’ variance request.

Next, to determine whether a variance imposes an unnecessary hardship depends on whether compliance with the restrictions would unreasonably prevent the owner from using the property for a permitted purpose. The BOZA noted that to grant a variance to the zoning ordinance, it had to find beyond a reasonable doubt the existence of all of the following: “(1) preservation of the intent of the ordinance; (2) ‘exceptional, extraordinary, or unusual circumstances or conditions’; (3) preservation of the property rights of others; (4) the variance request was not due to self-imposed hardship or solely on the basis of economic hardship; and (5) the absence of decrement.” The BOZA found that the Michaelses proved none of these criteria. Instead it found that the primary use for the Michaelses’ property is agricultural; that granting a variance to allow 200+ residential building sites is not consistent with the primary zoning; that the Michaelses continue to farm the property despite the stray voltage issues; that the Michaelses’ motivation was based solely on economic considerations (the property would be sold for less than they hoped without a variance); that granting a variance is not necessary to preserve their property rights to farm their land; and that granting a variance is contrary to the purpose and spirit of the zoning code because it would change the agricultural conduct of the area and would alter the density and distribution of the Town’s population.

The Michaelses also argued that the 2005 ordinance severely limited growth with no sunset provision, which causes an unconstitutional permanent moratorium.However, this claim applies to a rate-of-development (ROD) bylaw enacted fifteen years earlier, which limited the number of building permits the town could issue in a year. Although similar to the Town’s subdivision ordinance, the ROD ordinance was not at issue in case because the Michaelses never applied for a number of building permits over the limit. Furthermore, the Michaelses failed to demonstrate, beyond a reasonable doubt, that an unnecessary hardship results from compliance with the Town’s ordinances.

Finally, the Michaelses argue they are entitled to attorney fees under 42 U.S.C. § 1988(b) in this action. However, the circuit court concluded that the Michaelses’ procedural and substantive due process rights were not abridged. They were afforded a remedy by getting the hearing to which they were entitled. They also did not establish either that the 2005 ordinance is “clearly arbitrary and unreasonable,” with “no substantial relation to the public health, safety, morals or general welfare,”or that they were the victim of administrative action that “shocks the conscience.” Public welfare certainly can be related to the orderliness of community growth by the minimum-lot size ordinance in question. Thus the Michaelses have not shown that the circuit court erroneously exercised its discretion in denying their bid for attorney fees.

The Wisconsin Court of Appeals affirmed the Town of Farmington’s Board of Zoning Appeals’ decision.

Norman and Leatha Hein have operated a lawn care business from their rural home for 30 years. Their property is zoned as RR Rural Residential. In 2010, the Heins filed a petition with the Sedgwick County, Kansas Board of Zoning Appeals for three variances: “(1) to allow up to 20 employees with no more than 15 on site in excess of 1 hour per day; (2) to allow the use for business purposes of existing outbuildings with a combined floor area exceeding 3,000 square feet; and (3) to allow outdoor storage closer to the street than the buildings used for the business and closer than 200 feet from property lines.” The Heins alleged that these variances were necessary because they had acquired additional customers. Also, more equipment was stored at their property, and the new variances would allow the employees to perform necessary equipment maintenance on the property, especially during inclimate weather.

In October of 2010, the Board held a meeting at which the Heins’ petition was considered. The Board looked at the five criteria under K.S.A 12-759(e)(1) that must be met before the Board can grant a variance as well as the Board staff’s report, which recommended that only two of the three variance be granted under certain conditions. At this meeting, Norman Hein explained that the first variance was necessary to allow six drivers to transport lawn care equipment instead of the four needed in the past. It would also allow employees to gather at the property and share rides with each other to the job sites and account for the need to perform equipment maintenance on the property.

Several neighbors and customers spoke in support of the Heins’ petition at the meeting. The exceptions were Richard Gronniger and Terry and Larry Hacker. Gronniger owned property south of the Heins’, and Hacker operated Kansas Paving (a sand pit) on Gronniger’s property. Kansas Paving was paying for maintenance of the road (~$15,000 per year) that separates Gronniger’s and the Heins’ properties in accordance with the conditional use permit given to operate the sand pit. Gronniger and Hacker argued that the Heins should also be required to apply for a conditional use permit and contribute to road maintenance costs.

The Board initially found that all five criteria under K.S.A. 12-759(e)(1) had been met for each variance and granted all three for the Heins. Larry Hacker, Terry Hacker, Richard Gronniger, and Kansas Paving filed a petition in the district court challenging the reasonableness of the Board’s decision. After the district court twice reversed the Board’s decision, the Board appealed to the Kansas Court of Appeals, arguing that the plaintiffs lacked standing to appeal the Board’s decision, and so the district court, by extension, lacked jurisdiction to rule on the matter. The Board also argued that there was substantial evidence to support its finding of a hardship that was not self-created by the Heins in accordance with 12-759(e)(1)(C).

The Board argued that the plaintiffs’ only way to appeal its decision was under K.S.A. 12-759(f), which allows appeals from any person “dissatisfied with” a board of zoning appeal’s decision. The Board urged that the district court interpret the phrase “dissatisfied with” so as to give standing only to the original parties of a board’s proceedings, which is a smaller class of persons than those who may be “aggrieved by” a board’s decision under K.S.A. 12-760. The Board also argued that the plaintiffs did not have a particularized interest affected by its decision. To the contrary, the plaintiffs argued that they can appeal under both K.S.A. 12-759(f) and K.S.A. 12-760. The plaintiffs alleged that the Board’s above interpretation would prevent neighbors from appealing a board’s decisions that adversely affect their interests. The plaintiffs also held that they have a particularized interest in the increased traffic on and the increased maintenance costs of the road in question.

The Kansas Court of Appeals addressed the two relevant statutes at issue in this case: K.S.A. 12-759(f) and K.S.A. 12-760. The court held that a specific statute will control over a general statute. Since K.S.A. 12-759(f) applies only to decisions made by a board of zoning appeals, it is more specific than K.S.A. 12-760, which applies to multiple kinds of boards. Even so, the court ruled that the test for “dissatisfied with” in K.S.A. 12-759(f) should be considered the same as the test for “aggrieved by” in K.S.A. 12-760. The Kansas Court of Appeals cited its former decision in Tri-County Concerned Citizens, Inc. v. Board of Harper County Comm’rs that found that the plaintiffs had standing under K.S.A. 12-760 because the plaintiffs would suffer a pecuniary loss as a result of the county’s decision to allow a waste disposal company to build a new landfill nearby. Applying this decision to the current case, the court ruled that the Hackers, Gronniger, and Kansas Paving had a substantial grievance and a pecuniary interest in the effects of the Board’s decision, granting them standing under K.S.A. 12-759(f).

The Kansas Court of Appeals stated that under K.S.A. 12-759(e)(1), a board of zoning appeals is authorized to grant a variance only if all five statutory criteria are met. The only criterion at issue was the finding of an unnecessary hardship. In the past, the Kansas courts have held as a general rule that a variance may not be granted to relieve a self-created hardship. The Board argued that an unnecessary hardship may be found where hardship is imposed by self-created business growth. The plaintiffs argued that it cannot. Citing four different cases as precedent, the Kansas Court of Appeals found that there was no indication that the Heins would lose their business without the variances; the business would simply be less profitable. Considering this, self-created business growth is not an exception to the general rule that an unnecessary hardship may not be self-created.

The Kansas Court of Appeals concluded that the district court rightly found that the Board acted outside its scope of authority in granting the variances. The Heins expanded their business with full knowledge of the zoning regulations under which they were operating. Because the Board’s findings were not supported by substantial evidence, the district court’s rule to vacate the variances granted by the Board was affirmed.

The Rehkamps own property on Fifth Crow Wing Lake in Hubbard County (County) that is operated as a resort. The property includes 11 boat slips. In November 2009 the Rehkamps applied for a conditional use permit (CUP) to convert the resort into a residential planned unit development (PUD). The request was heard by the County Planning Commission, the Zoning Board of Adjustment (ZBA), and the County Board of Commissioners. The Board of Commissioners initially approved the CUP with three permanent boat slips and one access dock, per the County’s Shoreland Ordinance. It recommended that the Rehkamps apply to the ZBA for a variance in order to retain all 11 boat slips. The Rehkamps did so and were granted a variance. The entire plan was approved by all necessary boards in April 2010. Days after approval, Ed Mutsch (a resident on Fifth Crow Wing Lake) filed a complaint challenging the issuance of the variance. The district court reversed the granting of the variance, concluding that the ZBA’s decision was arbitrary, capricious, and not according to law since it did not consider all the factors required by law. This consolidated appeal followed.

On appeal, the Rehkamps first argued that Mutsch lacked standing to appeal the ZBA’s actions because he did not participate in the hearings and meetings regarding the variance. The Court dismissed this argument, noting that Minnesota statute grants the right to appeal a ZBA decision to any aggrieved person without any requirements to participate in initial proceedings. Since Mutsch is a property owner on Fifth Crow Wing Lake and evidence shows his property value will likely decline as a result of the additional boat slips, he qualifies as an “aggrieved person.”

The second issue questioned what type of zoning variance the ZBA granted since it was never specified during the trial. Mutsch purported that it was a use variance, which requires a showing of “particular hardship” while the Rehkamps argued it was an area variance, which only requires a showing of “practical difficulties” according to the Minnesota Supreme Court’s opinion in In re Stadsvold (2010). The Rehkamps argued that Mutsch waived the argument that it was a use variance when the issue was not property raised in district court. The Court agreed, and declined to address the question since it was not properly raised in initial proceedings. Consequently the Court of Appeals analyzed the variance as an area variance.

Next, the Rehkamps and the County challenged the district court’s determination that the ZBA’s decision was arbitrary and capricious. The district court concluded the decision was arbitrary because the ZBA failed to consider all of the required factors. In regard to variances, there are two relevant guidelines for the Court to consider. Section 1104 of the local Shoreland Ordinance provides a list of factors to consider and requires applicants to show an “unnecessary hardship” to receive a variance. In addition, a list of factors provided in the Stadsvold opinion is applicable when determining whether an area variance is warranted. The County first argued that, in light of the Stadsvold decision, section 1104 of the Shoreland Ordinance (unnecessary hardship) no longer applies to area variances in the shoreland zoning area, but rather the “practical difficulties” test solely should be applied. The Court rejected this argument, ruling that the Stadsvold opinion did not render section 1104 of the Shoreland Ordinance inapplicable to area variances requested on land to which shoreland zoning applies.

The Rehkamps next argued that the BOA “melded” the factors in the Stadsvold opinion with the factors in section 1104. The ZBA was required to “articulate the reasons for its ultimate decision, with specific reference to relevant provisions of its zoning ordinance.” The ZBA used a worksheet addressing each of the six Stadsvold factors (practical difficulties) when making its decision. The Court concluded that, since those six factors are not the same as the factors listed in section 1104, it did not “sufficiently articulate its reasons for ruling that the section 1104 factors (unnecessary hardship) were satisfied.” It found the ZBA’s decision to be premature, not necessarily arbitrary and capricious. It therefore remanded that portion of the decision to the ZBA for further consideration of the section 1104 standards.

The Rehkamps’ last argument was that the district court erred when it determined that not all of the ZBA’s findings in regards to the Stadsvold factors (practical difficulties) were supported by the record. The Court reviewed the evidence that supported each of the ZBA’s findings and found each to be supported by the record. It therefore reversed that part of the district court decision which found that the ZBA’s decision regarding the Stadsvold factors were not met.

Volunteers of America (VOA) proposed to build an apartment-style building for veterans in Omaha. To construct the building as planned, VOA applied to the Omaha Zoning Board of Appeals (Board) for variances from area and use restrictions. The appellants, Field Club Home Owners League and Thornburg Place Neighborhood Association (Field Club) opposed the application. The Board granted the variances, concluding that the 1987 Code created an unnecessary hardship because it did not contemplate a project like VOA’s. The district court affirmed the Board’s decision, and Field Club appealed to the Nebraska Supreme Court.

Field Club argued that VOA lacked standing to request variances from the Board because VOA had not obtained a certificate of authority pursuant to Neb. Rev. Stat. 21-20,169(1), which provides that “[a] foreign corporation transacting business in this state without a certificate of authority may not maintain a proceeding in any court in this state until it obtains a certificate of authority.” The Nebraska Supreme Court found the provision inapplicable because, although VOA is a foreign corporation, VOA was not “maintaining” a court proceeding. It was Field Club that petitioned the district court and named VOA as a defendant.

Field Club also contended that because the owner of the property was Kiewit Construction Company, and not VOA, that VOA lacked standing because it had no legally cognizable interest in the property. The Supreme Court noted that the majority of courts that have considered the issue hold that a prospective purchaser under a purchase agreement subject to the grant of a variance or rezoning has standing to seek the change. Similarly, courts have held that the holder of an option to purchase property has standing to apply for a variance when the holder is bound to purchase the property if the variance is obtained or when the property owner anticipated that the option holder would seek the variance to complete the sale. The Supreme Court agreed with these other jurisdictions, and further noted that the principles hold true in administrative proceedings as well as judicial proceedings.

However, the Supreme Court noted that Field Club did not raise the issue of standing until the case reached the Supreme Court. Partly as a result of this, the record did not contain evidence addressing VOA’s interest in the property. Therefore, the Supreme Court remanded the case to district court to receive additional evidence and determine whether VOA had sufficient interest in the property to seek the variances.

In the 2010 decision Krummenacher v. City of Minnetonka (our post on the decision can be found here) the Minnesota Supreme Court adopted a restrictive interpretation of “undue hardship” for city boards of adjustment to apply when deciding on variance applications, similar to the interpretation of unnecessary hardship applied by the Iowa courts throughout the years. Unlike Iowa, however, the Minnesota Legislature quickly remedied the situation by passing legislation that put a “practical difficulties” standard into Minnesota state code (Minnesota House File 52 can be found here). Under the new law, practical difficulties means (1) the property owner proposes to use the property in a reasonable manner permitted by the ordinance, (2) the owner’s plight is due to circumstances unique to the property not created by the owner, and (3) the variance will not alter the locality’s essential character. If the variance is granted with conditions, those conditions must be directly related to, and bear a rough proportionality to the impact of the variance.

The difference between “undue hardship” as applied by the court, and “practical difficulties” as passed by the legislature, is the absence of the requirement that the landowner show the property cannot be put to a reasonable use but for the variance. Again, this is nearly identical to the challenge facing landowners and boards of adjustment in Iowa. There was a bill introduced in the last Iowa legislative session to put “practical difficulties” in the Iowa Code, but it did not make it out of committee.